2.What does it mean to localize a website or application?

For accurate and appropriate localization, use professional translators with expertise in the relevant language and industry.

Localization is not just about translating words from one language to another language. Localization is preparing a specific representation of an application, web page, or marketing content to be best suited for a particular market.

Localization may not even require a different language to be localized for a specific market. For example,
India
United States
Nigeria
The United Kingdom

Each country could have its own localized content which which will highlight:

Images and videos which are the most culturally relevant for the region
Separate pricing, contract, phone numbers etc.
Slightly different words for different regions.
They could even have different example content, or references that are more easily understood within the specific region.
Different Cultural, Political, Legal or Linguistic differences.

The cultural differences being represented on your site are a crucial part of localization. It is difficult for a user to read accurate prices and regional promotions if a place only translates its website into one language and currency.
This makes it essential to customize not only the text but the content of a site to increase ease of use and user satisfaction.
The Church of Jesus Christ of Latter-day Saints uses this method. For example, if you wanted to see the scriptures in English, you would use this URL :

https://www.churchofjesuschrist.org/study/scriptures?lang=eng&platform=web

And if you wanted to see the scriptures in Japanese you would use this url
https://www.churchofjesuschrist.org/study/scriptures?lang=jpn&platform=web